Controversial $500m development ramps up as court tosses out bid for judicial review

The controversial $500 million development of Wellington’s Shelly Bay can get going now the High Court has tossed out a legal challenge to the project.

But while Enterprise Miramar Peninsula has lost its attempt to get a judicial review of Wellington City Council’s consents for The Wellington’s Company’s development, it is assessing what options it now has.

Enterprise Miramar wanted the two consents quashed or set aside and claimed the council made mistakes/errors of law; acted for improper purposes; failed to consider mandatory relevant considerations; and was tainted by apparent bias on account of alleged conflicts of interest affecting the council.

In his decision Justice Peter Churchman says Enterprise Miramar’s witnesses don’t seem to have accepted that the decision by the minister to declare the site a special housing area was unchallenged at the time and is not reviewable in the court proceedings.

“The witnesses also do not seem to understand or accept that the procedures mandated under The Housing Accords and Special Housing Areas Act (HASHAA), particularly in relation to notification and the opportunity for input by entities such Enterprise Miramar into the decision-making process, are very different to those under the Resource Management Act.

“The HASHAA simply does not provide for the Miramar community to have a say on applications such as this.”

Wellington Mayor Justin Lester says the decision is an excellent result. “It’s an endorsement of the council’s planning processes for Shelly Bay but, more importantly, it’s an endorsement of the proposal by iwi and The Wellington Company to turn a dilapidated site into something special and beneficial for Wellington.”

Special housing area
Shelly Bay was at one time an NZ Defence Force base but the Port Nicholson Block Settlement Trust bought it in 2009 for $13.5 million using Treaty of Waitangi settlement money.

In June 2015, 2.79ha of Shelly Bay was declared a special housing area (SHA). By the end of that year, the SHA area was extended to 7.3ha to include all the trust’s land holdings.

As part of the deal, the council agreed to sell about 0.3ha of public land at Shelly Bay valued at about $2.5m for housing and to lease a further 0.6ha of land and two buildings on a 125-year agreement for commercial, mixed-use development. The lease is valued at about $5m. 

The council retained 2.6ha to be used for public space, a waterfront promenade and road access.

Nearly four years ago, developer Ian Cassels’ The Wellington Company made an agreement with the trust and its land-owning entity to form a joint venture – Shelly Bay Ltd (SBL) – to develop Shelly Bay and transform the derelict area into the capital’s version of San Francisco’s seaside town of Sausalito. They can now go ahead with the development under the non-notified consents.

One of Mr Cassels’ companies, Shelly Bay Investments owns 11.9ha at Shelly Bay, including PBNST property, which it bought for about $6m.

Village atmosphere
Redevelopment of the site includes 350 dwellings made up of 12 multi-level residential apartment buildings, containing about 280 apartments; 58 townhouses; 14 individual dwellings; a 50-bed boutique hotel and possible construction of an aged care facility accommodating some 140 residents across 120 living units.

As well as buildings to accommodate commercial/community activities and the adaptive reuse of buildings such as the submarine mining depot barracks, officers’ mess and shipwrights' building, there will also be a village green and the realignment of the road through Shelly Bay.

The proposed redevelopment of Shelly Bay is to include housing, a boutique hotel and rest home.

Since the area ceased to be actively used for military purposes 25 years ago, there has been a lack of maintenance on the built structures and several are in a state of significant disrepair. Parts of the site are rundown and neglected. Mr Lester says he is looking forward to working with local iwi and getting the project under way.

“This rundown area has sat dormant for a long time and it’s exciting we will now be able to improve the area.”

The council’s acting chief executive, Kane Patena, sees the High Court decision as a vindication of both the proposed development and of the council’s planning process.

“We were always confident the council had followed good process in terms of its procedures and its interpretation of legislation.

“The court pointed to evidence confirming the decision-makers appropriately and properly applied independent judgment to the decisions they were asked to make. 

“The court also went further and accepted our argument that the notion of bias does not easily apply to a council as decisionmaker. The court agreed that s34A of the RMA is a permissive provision enabling councils to delegate decision-making to hearing commissioners for a range of reasons.  The provision does not require councils to do so where it has an ‘interest’ of some sort in the application made.”

Mr Patena says the court did not accept that the practice of other councils around the country was required legally. 

“This ruling confirms the council’s approach to delegations of resource consent decisions (under which non-notified consent decisions are processed and determined by the resource consenting team) is lawful and proper.”